Model A Fiscal Sponsors

Does your fiscal sponsorship agreement with them address situations like this? Does it state that you can terminate for cause with no notice?

I agree with Beth’s question. The fact they are taking action that likely needs your board approval seems like valid cause to terminate.

I’m guessing that your FS agreement does not cover every eventuality that might arise, though hopefully does have some general language that allows you, comfortably, to exercise your variance power. At a minimum, you could freeze their account, ie. not allow them to spend money until this is resolved. Also, if you don’t sign the representation agreement with the attorney, the attorney cannot be engaged. It may be the case that the attorney is not aware this is a Model A sponsored project and might need to be informed of that fact. So much fun!!

We ended up converting them from a Model A to a Model C. They are allowed to proceed with their intended legal action as an unincorporated association. The legal filings will explicitly name their group rather than us as their sponsor. Just wanted to add this update in case it comes up for anyone else.

Interesting solution, Amanda. I’m sure you’ve considered this but one of the complications we run into when thinking about an A to a C change is that the assets (mostly, the IP and any tangible items) of the A cannot be transferred to a non-c3 so I’d be curious what their legal entity is and how you’ve navigated this small, yet important detail?